Hoping to fill part of Mexico’s demand for US natural gas is ONEOK, whose subsidiary Saguaro Connector Pipeline has filed a presidential permit application with the Federal Energy Regulatory Commission (FERC) to construct and operate facilities for the exportation of natural gas at a new international border-crossing at the U.S. and Mexico border in Hudspeth County.

The proposed border facilities would connect upstream with a potential intrastate natural gas pipeline, the Saguaro Connector Pipeline, which would be designed to transport natural gas from ONEOK's existing WesTex intrastate natural gas pipeline system in the Permian Basin in West Texas to Mexico. Additionally, the proposed border facilities would connect at the International Boundary with a new pipeline under development in Mexico for delivery to an export facility on the west coast of Mexico.

The potential Saguaro Connector Pipeline would consist of approximately 155 miles of 48-inch-diameter natural gas pipeline originating at the Waha Hub in Pecos County. The ultimate design capacity of the potential pipeline would be approximately 2.8 billion cubic feet per day. Final investment decision on the potential pipeline is expected by mid-2023.

James Taylor, senior energy analyst at East Daley Analytics, told the Reporter-Telegram by email that ONEOK’s announcement was somewhat surprising.

“Although there are several planned LNG facilities slated to be constructed on Mexico’s Pacific Coast and the likely source for all that supply would be the Permian Basin, ONEOK has not specified which facility(s) they plan to supply and the pipeline on the Mexico side of the boarder still needs to be approved and constructed. Only Sempra’s Costa Azul LNG facility has been sanctioned,” he wrote. That means, he added, that it will be some time before the project is complete.

Still, Taylor wrote, “if all the LNG comes to fruition, it would provide a welcome destination for Permian gas and help balance out (price) basis versus Henry Hub.”

(Written by  Mella McEwen )